Steel mills under the jurisdiction of North China’s Tangshan city have been imposed on another round of emergency restrictions on their sintering and coking facilities starting the evening of November 15 due to poor air quality forecast in the coming days, though measures seem not as stringent as the previous round over October 28-November 7, market sources shared on Tuesday.
The latest emergency curbing measures have been impacting not only local steel mills but other polluting industrial sectors since 1800 Beijing time on November 15, and heavy-duty diesel-fuelled trucks to and from local ports and in and out of steelworks are expected to be temporarily banned too during the night hours, and it is unknown when these will be lifted, Mysteel Global noted.
“We have curtailed our sintering operations according to the local authority’s order,” an official from a Tangshan-based steelmaker confirmed, and “the latest measure seems not as harsh as the last time, as it is more about sintering, with no mentioning of more curbs on blast furnaces, and it will largely be lifted when air quality improves,” he added.
The impact of the latest curbing on steel production is expected to be rather moderate too, as some local steel mills have not ramped up their steel production much after the end of the curb on November 7, and they will not be in any hurry with the domestic steel market fundamentals as of now, according to some market sources.
“Razor-thin steel margins or even loss-making for some steel mills have made them unkeen to produce much, and some steel mills can’t increase output much due to rather low sintered ore stocks with frequent curbings on the sintering operations,” a Shanghai-based iron ore analyst pointed out.
The frequent emergency curbs on steelmakers in Tangshan, China’s largest steelmaking city, have been steadily diminishing iron ore demand in this area, and recent declines in iron ore demand among Chinese steel mills including those in Tangshan on lower steel output saw Mysteel SEADEX 62% Australian Fines plunge to $88.75/dmt CFR Qingdao by November 15, or a new low since May 11, 2020.
Written by Victoria Zou, zyongjia@mysteel.com
This article has been published under an article exchange agreement between Mysteel Global and SteelMint.
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